Kenyan banker Gideon Muriuki’s Co-op Bank secures $100 million from global investors

Co-operative Bank Group (Co-op Bank), a Nairobi-based financial services group led by Kenyan banking magnate Gideon Muriuki, has successfully secured a total of $100 million in long-term debt from global institutional investors, with the German fund DEG and the Norwegian fund Norfund at the helm.

Notably, Norfund revealed that a subordinated loan of $19.4 million was channeled through the European Financing Partners, a joint venture between the European Investment Bank (EIB) and several other European funds.

This financing will aid Co-op Bank in strengthening its capital base, with Norfund participating in the financing through a direct credit line of $16 million and an additional $3.4 million through European Financing Partners.

Through this substantial amount of funding, Co-op Bank is poised to provide much-needed support to micro, small, and medium enterprises (MSMEs) while simultaneously positioning the bank for future growth.

Seeing as Co-op Bank is the third-largest bank in Kenya, with 65 percent ownership by local co-operatives, and the largest co-operative bank in Africa, this injection of funds is sure to have a substantial impact.

The recent move of Co-operative Bank Group to secure a total of $100 million in long-term debt from global institutional investors comes three months after the Kenyan financial services group reported a staggering profit of Ksh17 billion ($140 billion) at the end of the first nine months of its 2022 fiscal year.

Co-op Bank, which is one of the largest financial organizations in East Africa, is led by Muriuki, a multimillionaire banker and businessman, who holds a two-percent stake in the leading financial services group.

With subsidiaries such as Kingdom Securities Limited, Co-op Trust Investment Services Limited, Co-operative Consultancy & Insurance Agency Limited, Kingdom Bank Limited, and the Co-operative Bank of South Sudan, Co-op Bank serves as the primary banker for Kenya’s SACCOs.

At the time of writing, Co-op Bank shares on the Nairobi Securities Exchange were trading at Ksh12.5 ($0.0985), 4 basis points lower than their opening price this morning, pushing the company’s market capitalization further below the Ksh74-billion ($580 million) mark.

The market value of Muriuki’s two-percent stake in Co-op Bank is now worth Ksh1.48 billion ($11.7 million).